Ubs To Cut Jobs In An Attempt To Reduce Costs

Ubs To Cut Jobs In An Attempt To Reduce Costs by Emily Clark last updated on October 06, 2023

UBS To Cut 3K Jobs In An Attempt To Reduce Costs

Now that we are finally done with UBS's takeover of Credit Suisse, the real question is how the banking giant will cut costs & increase profitability.

According to the latest details, the UBS group is planning to cut 3K jobs. This is part of the company's larger plan to introduce cost cuts worth $10 billion. The supposed job cuts will only happen within Switzerland, which suggests that more job cuts might be on the way.

Overall, 1 out of 12 jobs in the company will be cut in Switzerland, which also gives a glimpse of the shake-up that's expected at the new UBS group.

Jobs Cuts Are Part Of Billion Dollars Cost Cutting Plan

It still remains to be seen whether this move will restore the investors as well as the customer's confidence or not. After all, customers ended up withdrawing billions of dollars as the panic regarding the financial health of Credit Suisse intensified.

The recent job cuts are part of the UBS plan to turn things around for Credit Suisse and make it profitable rather than spinning it off or selling it.

According to CEO Ermotti, the full integration of Credit Suisse is the only outcome that's best for the Swiss economy and the UBS. He also mentioned the recent job cuts in a recent memo which is an indication that people working at the company are also aware of what's going on.

On a global scale, around 8K workers of Credit Suisse left the company during 1H2023. This indicates that many people are already leaving the company of their own accord. One such example is leaving the company through retirement.

By the end of 2026, the UBS group plans to cut back $10 billion which would otherwise be regarded as costs. And for the year 2027, the estimate is set at $8 billion.

After the recent announcement, UBS shares were up by around 5% which is one of the highest levels only seen during 2008.